Why do we live where we do? Chances are, that there’s a good reason for our choice of home and suburb.
The same applies to your tenants: they’ll also usually have very specific needs and motivations for living where they do. And you, as a landlord, need to have found out what this motivation is. Many of these motivators are due to convenience, security, time and cost benefits.
Why you need to find out what’s motivating your tenant
If you can find out why your tenant wants to live in a particular suburb, you can start making a few assumptions about them and how long they’re likely to stay.
Here are some examples of common motivators:
- Proximity to schools: Very often a tenant will want to live within a catchment area of a specific school. This is a good motivator, and means that your tenant is very likely to keep renting from you whilst their child attends that school.
- Proximity to work: Again, this is a very good motivator, because it affects their bottom line (travel costs) and time committed to employment (travel time). Travel time is directly linked to the ‘quality time’ the tenant has available for their partner or family. This is one of the key reasons inner city properties tend to be some of the more expensive to rent and purchase.
- Lifestyle factors: Being close to entertainment and cafés is a common motivator i.e. the tenant simply finds the property and locality attractive.
- Family needs: If the tenant is looking for somewhere for family to live, because they also live nearby, it shows that they are reasonably committed to that area. It also means that they have to spend less time and money travelling to see their relative. But often the most important factor is peace of mind: knowing that they are close by should an elderly or ailing relative need them.
- Proximity to friends and family: The more roots the tenant has in the area, the more likely they are to stay for a while.
- Moving cities: Tenants who need to relocate due to work are usually under time constraints: they have very little time to find a new home, and will make decisions quickly. Tenant applicants in this situation are very motivated as they don’t have a fall-back option, and don’t have the luxury of time to keep looking.
- The landlord is selling the rental property or moving back into it: Tenants put into this position will also be under a time constraint and will need to move quickly as there is a set date by which they need to move out of their current property (under a periodic tenancy or at the end of a fixed term tenancy). Because of this set deadline, tenants in this situation are fairly committed when applying for a new tenancy.
What if the tenant can’t or won’t say why they want to live in the area?
If the tenant can’t give a valid reason as to why they want to live in the area, be very wary indeed. A tenant without this kind of motivation may not be inclined to stay around for very long, and you could find yourself re-letting the property again a lot sooner than you’d hoped for. Remember, at the tenant application stage you’re trying to establish how well the applicant can communicate their desires for the tenancy. If they can’t provide clarity as to why they want the tenancy then perhaps they aren’t the best tenant applicant.
It is very important that you establish their needs for the property at the tenancy application stage. They need to clearly demonstrate why they need the property. Most good tenant applicants will sell themselves to the landlord and highlight why the property is attractive to them.
Remember, your goal is to find that A1 tenant that’ll pay market rent on time, every time – and will continue to do so for as many years as possible.
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